Q2 2026 Lojas Quero-Quero SA Earnings Call
Speaker #1: Good morning, everyone. Welcome to Lojas, Quero Quero's second quarter 2026 earnings conference call. My name is Igor Sen, Financial Planning and Investor Relations Manager, and joining me today are Peter Furukawa, Chief Executive Officer, and Jean Mello, CFO and IRO.
Speaker #1: To begin our presentation, please turn to slide 3. Today we will begin speaking about our strategic pillars, followed by our expansion and key projects.
Speaker #1: We will then review our financial and operating results for the second quarter of 2026, and finally we will open the floor for questions and answers session.
Speaker #1: Questions may be submitted at any time by using the Zoom Q&A button. We will now move on to slide 4. I turn the floor over to Peter.
Speaker #1: Well, good morning, everyone. It is a pleasure to be here once again to share the highlights of our second quarter 2026 results. As we reach the midpoint of the year, we continue to see operations evolving consistently in line with the expectations we established at the beginning of 2026, although the macroeconomic environment remains challenging particularly to the high cost of capital.
Speaker #1: But we remain focused on what is within our control: strengthening our customer value proposition, maintaining financial discipline, preserving the quality of our credit for portfolio, and continuing to execute our long-term strategy throughout 2025.
Speaker #1: We made a deliberate decision to enhance our customer service and competitiveness in order to gain market share. Even in a weaker consumer environment, we had positive signals delivered in the first quarter of the year, and we now see that strategy reflected more clearly in our operating performance during this quarter.
Speaker #1: We continue to make progress across our five strategic pillars. Under our first pillar, gaining market share, gross revenue increased 9.7% year over year, reaching $834 million.
Speaker #1: The main highlight you can see in the same store sales that represented 7.6%, showing the gradual recovery we observed since the second quarter of last year.
Speaker #1: We also inaugurated three new stores ending the quarter with 7.576 stores in operation. We have had significant market gains in credit and collections excellence.
Speaker #1: We continue to balance growth with portfolio quality. Our credit portfolio grew 12% vis-à-vis the second quarter of 2025, while delinquency remained under control with loans over 90 days past due at $12.5%, in line with the company's historical levels.
Speaker #1: This reinforces our confidence that our strategy of continuously refining our credit models is still appropriate for the current economic environment under the due, more with less pillar we continue to improve operational efficiency.
Speaker #1: Selling expenses increased only by 1.8% on a nominal basis, below the inflation rate now. Once again, this is below the inflation rate, reflecting our ongoing cost control efforts.
Speaker #1: Courses are confidence that our strategy of continuously refining our credit models is still appropriate for the current economic environment under the due more with less pillar we continue to improve operational efficiency selling expenses increased only by 1.8%.
[Company Representative] (Lojas Quero-Quero): This reinforces our confidence that our strategy of continuously refining our credit models is still appropriate for the current economic environment. Under the do more with less pillar, we continued to improve operational efficiency. Selling expenses increased only by 1.8% on a nominal basis below the inflation rate. Once again, this is below the inflation rate, reflecting our ongoing cost control efforts. Administrative expenses remained virtually flat compared to the previous year, demonstrating disciplined resource allocation even as sales growth resumed. In digital sales, our digital initiatives continued to account for approximately 23% of total sales, reinforcing the consolidation of our fully integrated physical and digital business model. Finally, under our high performance culture pillar, we continued investing in leadership development.
[Company Representative] (Lojas Quero-Quero): This reinforces our confidence that our strategy of continuously refining our credit models is still appropriate for the current economic environment. Under the do more with less pillar, we continued to improve operational efficiency. Selling expenses increased only by 1.8% on a nominal basis below the inflation rate. Once again, this is below the inflation rate, reflecting our ongoing cost control efforts. Administrative expenses remained virtually flat compared to the previous year, demonstrating disciplined resource allocation even as sales growth resumed. In digital sales, our digital initiatives continued to account for approximately 23% of total sales, reinforcing the consolidation of our fully integrated physical and digital business model. Finally, under our high performance culture pillar, we continued investing in leadership development.
Speaker #1: Administrative expenses remained virtually flat compared to their previous year. Demonstrating discipline resource allocation even as sales growth resumed. In digital sales, our digital initiatives continue to account for approximately 23% of total sales.
Speaker #1: A nominal basis below the inflation rate—now, once again, this is below the inflation rate, reflecting our ongoing cost control efforts. Administrative expenses remain virtually flat compared to the previous year.
Speaker #1: Reinforcing the consolidation of our fully integrated physical and digital business model. Finally, under our high-performance culture pillar, we continued investing in leadership development. We graduated 26 new store managers and ended June with $254 employees.
Speaker #1: Demonstrating discipline resource allocation even as sales growth resumed. In fidgetal sales our digital initiatives continue to account for approximately 23% of total sales. Reinforcing the consolidation of our fully integrated physical and digital business model.
Speaker #1: Employed in our discounted leadership development program, preparing future leaders to take on management positions across our store network to support the company's continued growth.
Speaker #1: Finally, under our high performance culture pillar, we continue to invest in leadership development. We graduated 26 new store managers and ended June with 254 employees enrolled in our "Ponte" leadership development program, preparing future leaders to take on management positions across our store network to support the company's continued growth.
[Company Representative] (Lojas Quero-Quero): We graduated 26 new store managers and ended June with 254 employees employed in our Dez Pontes leadership development program, preparing future leaders to take on management positions across our store network to support the company's continued growth. In expansion, we ended Q2 with 576 stores in operation across 495 cities in the states of Rio Grande do Sul, Santa Catarina, Paraná, Mato Grosso do Sul, and São Paulo. During H1, we opened five new stores, including three during Q2: two in Paraná state, in the cities of Maringá and Guarapuava, and one in Iguatemi, Mato Grosso do Sul. We also completed three store remodels as part of our active portfolio management strategy, always aimed at continuously improving the profitability of our store base. A key characteristic of our business model remains unchanged.
[Company Representative] (Lojas Quero-Quero): We graduated 26 new store managers and ended June with 254 employees employed in our Dez Pontes leadership development program, preparing future leaders to take on management positions across our store network to support the company's continued growth. In expansion, we ended Q2 with 576 stores in operation across 495 cities in the states of Rio Grande do Sul, Santa Catarina, Paraná, Mato Grosso do Sul, and São Paulo. During H1, we opened five new stores, including three during Q2: two in Paraná state, in the cities of Maringá and Guarapuava, and one in Iguatemi, Mato Grosso do Sul. We also completed three store remodels as part of our active portfolio management strategy, always aimed at continuously improving the profitability of our store base. A key characteristic of our business model remains unchanged.
Speaker #1: In expansion, we ended the second quarter with $576 stores in operation across 495 cities in the states of Rio Grande do Sul, Santa Catarina, Paraná, Mato Grosso do Sul, and São Paulo.
Speaker #1: During the first half of the year, we opened 5 new stores, including 3 during the second quarter. Two in Paraná State in the cities of Mariluz and Borazópolis, and one in Iguatemi, Mato Grosso do Sul.
Speaker #1: In expansion, we ended the second quarter with 576 stores in operation across the states of Rio Grande do Sul, Santa Catarina, Paraná, Mato Grosso do Sul, and São Paulo. During the first half of the year, we opened 5 new stores, including 3 during the second quarter.
Speaker #1: We also completed 3 store remodels as part of our active portfolio management strategy, always aimed at continuously improving the profitability of our store base.
Speaker #1: Two in Paraná State, in the cities of Mariluz and Borazópolis, and one in Iguatemi, Mato Grosso do Sul. We also completed three store remodels as part of our active portfolio management strategy.
Speaker #1: A key characteristic of our business model remains unchanged: 56% of our stores are located in cities. With fewer than 25,000 inhabitants, 73% are in municipalities with fewer than 5,000 inhabitants.
Speaker #1: Always aimed at continuously improving the profitability of our store base, a key characteristic of our business model remains unchanged: 56% of our stores are located in cities with fewer than 25,000 inhabitants, and 73% are in municipalities with fewer than 5,000 inhabitants. Now, the results achieved in the first half of the year reinforce our confidence in the strategy we are executing. We continue to prioritize cash generation, credit portfolio quality, and sustainability to allow for consistent growth for the company during 2026.
Speaker #1: Now, the results achieved in the first half of the year reinforce our confidence in the strategy we are executing. We continue to prioritize cash generation, credit portfolio, quality sustainability to allow for consistent growth for the company during 2026.
[Company Representative] (Lojas Quero-Quero): 56% of our stores are located in cities with fewer than 25,000 inhabitants. 73% are in municipalities with fewer than 5,000 inhabitants. The results achieved in H1 reinforce our confidence in the strategy we are executing. We continue to prioritize cash generation, credit portfolio quality, sustainability to allow for consistent growth for the company during 2026. With this, I will give the floor to Jean, who will refer to the financial results during the quarter. Thank you, Peter. A good day to all of you. I will go straight to the next slide to speak about the behavior of our revenues during this quarter. We'll go into a little more detail. We had a quarter that shows that consistent and gradual improvement of the company's sales and consequently of the revenues.
[Company Representative] (Lojas Quero-Quero): 56% of our stores are located in cities with fewer than 25,000 inhabitants. 73% are in municipalities with fewer than 5,000 inhabitants. The results achieved in H1 reinforce our confidence in the strategy we are executing. We continue to prioritize cash generation, credit portfolio quality, sustainability to allow for consistent growth for the company during 2026. With this, I will give the floor to Jean, who will refer to the financial results during the quarter. Thank you, Peter. A good day to all of you. I will go straight to the next slide to speak about the behavior of our revenues during this quarter. We'll go into a little more detail. We had a quarter that shows that consistent and gradual improvement of the company's sales and consequently of the revenues.
Speaker #1: With this, I will give the floor to Sean, who will refer to the financial results during the quarter. Thank you, Peter. A good day to all of you.
Speaker #1: I will go straight to the next slide. To speak about the behavior of our revenues during this quarter, we'll go into a little more detail.
Speaker #1: With this I will give the floor to Shawn who will refer to the financial results during the quarter. Thank you Peter a good day to all of you I will go straight to the next slide to speak about the.
Speaker #1: We had a quarter that shows that consistent and gradual improvement of the company's sales and consequently of the revenues we had a 10% growth in revenues for the quarter, and the main indicator is the same store sales.
Speaker #1: Behavior of our revenues during this quarter we'll go into a little more detail we had a quarter that shows that consistent and gradual improvement of the company's sales and consequently of the revenues we had a 10% growth in revenues for the quarter and the main indicator is same store sales in the graph at the bottom of the slide you can see that throughout the second quarter of last year we had signals of a lower demand we were able to implement some changes improving proposals for customers and we saw benefits as of the fourth quarter of last year therefore the performance improved through time in the first quarter we mentioned that with the exception of lines geared to air conditioning that had done very well in the first quarter 25 all others were positive so we had a slight improvement and this has been consolidated now in the second quarter where we reached same store sales growth of 6.7% total sales growing 8% 8% growth in financial services and a growth in credit cards 9% now this was based on our expectation a gradual operational improvement throughout the year and this expectation of course remains and what we had been planning I think has become ever clear here on the next slide we were able to maintain a virtually stable position with the retail margin in a scenario of weaker demand and despite the gain of share we were able to maintain a stable retail margin vis-a-vis the first margin 2.5% based on gross profit compared to last year and we are performing somewhat below the plan and we have the financial services we knew that we would have a higher cost as Peter mentioned because of the cost of capital somewhat higher that had been foreseen at the beginning of the year and of course we have been very cautious were careful with default levels we maintain our customer portfolio under control and we can speak about this in detail subsequently to ensure that everything is under control is to be more conservative in the granting of credit this means to say to have less products that have a high rate of default so we sort of put aside the revenue margin for the short term to guarantee that in coming quarters even in an adverse scenario we can maintain a controlled credit portfolio and a healthy growth for the company on the next slide we have construction during the last quarters and during the last years always keeping a focus on the level of expenses it is important to keep this under control and to decide where to allocate our investments and in this second quarter we have a nominal reduction in operating expenses very similar to what we saw in the first quarter so in this second quarter specifically we had a growth of sales of 1.8% below the inflationary pressure and yes we do have that ability to have operating leverage general and administrative expenses aligned with the second quarter of 25 positive as well as other SG&A expenses so this part of expenses is being kept under control and we can go back to have being a better operating leverage as soon as the sales increase on the next slide we reach an EBITDA of 32.6 vis-a-vis 29 for the previous quarter now as the same store to show an improvement as we saw in the previous slides we can show you that we have an opportunity for operational leverage very similar to the second quarter of 25 the same holds true for adjusted EBITDA aligned with the previous quarter on the next slide we maintain the cost of capital a little higher but more aligned with the second quarter of 2025 and the net result of 30 million nominally is virtually the same as that of the second quarter of 25 this is what we had been remarking on that as soon as we could have an increase in sales same store sales on a positive direction we would be able to stabilize our results and have that possibility of improving throughout the year on the next slide we will go into greater details we maintain the quality of our portfolio and here you can see the growth of our credit portfolio historically especially with the 90-day default rate that is maintained at 12.5% for the second quarter this of course is a historical achievement especially if we compare this with 24 we follow up on the default levels in the market as a whole and you can see that we have been able to maintain the quality of our credit portfolio and we have an ever growing credit portfolio growing in a very healthy way so we stand at 12.5% in the second quarter compared to 12% in the previous quarter now this these results are due to a broader use of our credit cards we had a growth of 13% in this quarter and we're gaining relevance in our credit cards for our customers and for the customer this credit card is becoming ever more relevant in their day-to-day uses we now go on to the next slide and something that will have an impact as Peter mentioned the maintenance and control default and our credit portfolio but also have an impact on our cash flow we have a guidance of opening up several stores this quarter we opened up five in this quarter so this shows a reduction of investment once again because of the high cost of capital and you see an investment of 16.2 million and all of this will lead us to what we see in the next slide which is a controlled net debt in the last four quarters we haven't had cash consumption even with our financial expenses and the high cost of capital despite this we're working strongly focusing on investments working capital to maintain the net debt under control in the second quarter we have the same net debt as in the first quarter of 26 which is the nominal debt with variations of one or two million and this compared to the second quarter of 25 we had already remarked on this and it becomes clear in the second quarter that we're working on cap cash flow to maintain once again the company debt under control well I don't want to be repetitive but this is what has been happening historically we have a cash consumption in the first half of the year and cash production in the second half of the year this is what tends to normally happen and we don't expect anything different throughout.
Speaker #1: In the graph at the bottom of these slides, you can see that throughout the second quarter of last year, we had signals of a lower demand; we were able to implement some changes, improving proposals for customers, and we saw benefits as of the fourth quarter of last year.
[Company Representative] (Lojas Quero-Quero): We had a 10% growth in revenues for the quarter. The main indicator is same-store sales. In the graph at the bottom of this slide, you can see that throughout Q2 of last year, we had signals of a lower demand. We were able to implement some changes, improving proposals for customers, and we saw benefits as of Q4 of last year. The performance improved through time. In Q1, we mentioned that with the exception of lines geared to air conditioning that had done very well in Q1 2025, all others were positive. We had a slight improvement, and this has been consolidated now in Q2, where we reached same-store sales growth of 6.7%, total sales growing 8%, 8% growth in financial services, a growth in credit cards 9%.
[Company Representative] (Lojas Quero-Quero): We had a 10% growth in revenues for the quarter. The main indicator is same-store sales. In the graph at the bottom of this slide, you can see that throughout Q2 of last year, we had signals of a lower demand. We were able to implement some changes, improving proposals for customers, and we saw benefits as of Q4 of last year. The performance improved through time. In Q1, we mentioned that with the exception of lines geared to air conditioning that had done very well in Q1 2025, all others were positive. We had a slight improvement, and this has been consolidated now in Q2, where we reached same-store sales growth of 6.7%, total sales growing 8%, 8% growth in financial services, a growth in credit cards 9%.
Speaker #1: Therefore, the performance improved through time. In the first quarter, we mentioned that with the exception of line geared to air conditioning that had done very well in the first quarter, 25; all others were positive.
Speaker #1: So we had a slight improvement, and this has been consolidated now in the second quarter where we reached same store sales growth of 6.7%, total sales growing 8%, 8% growth in financial services, and a growth in credit cards, 9%.
Speaker #1: Now, this was based on our expectation, a gradual operational improvement throughout the year, and this expectation, of course, remains. And what we had been planning, I think, has become ever clear here.
Speaker #1: On the next slide, we were able to maintain a virtually stable position with the retail margin in a scenario of weaker demand and despite the gain of share, we were able to maintain a stable retail margin.
[Company Representative] (Lojas Quero-Quero): This was based on our expectation of gradual operational improvement throughout the year. This expectation, of course, remains. What we had been planning, I think, has become ever clear here. On the next slide, we were able to maintain a virtually stable position with the retail margin in a scenario of weaker demand. Despite the gain of share, we were able to maintain a stable retail margin vis-à-vis the first margin, 2.5% based on gross profit compared to last year. We are performing somewhat below the plan, and we have the financial services. We knew that we would have a higher cost, as Peter mentioned, because of the cost of capital somewhat higher that had been foreseen at the beginning of the year. Of course, we have been very cautious. We're careful with default levels.
[Company Representative] (Lojas Quero-Quero): This was based on our expectation of gradual operational improvement throughout the year. This expectation, of course, remains. What we had been planning, I think, has become ever clear here. On the next slide, we were able to maintain a virtually stable position with the retail margin in a scenario of weaker demand. Despite the gain of share, we were able to maintain a stable retail margin vis-à-vis the first margin, 2.5% based on gross profit compared to last year. We are performing somewhat below the plan, and we have the financial services. We knew that we would have a higher cost, as Peter mentioned, because of the cost of capital somewhat higher that had been foreseen at the beginning of the year. Of course, we have been very cautious. We're careful with default levels.
Speaker #1: Vis-à-vis the first margin, 2.5% based on gross profit compared to last year, and we are performing somewhat below the plan, and we have the financial services we knew that we would have a higher cost as Peter mentioned because of the cost of capital somewhat higher that had been foreseen at the beginning of the year, and of course, we have been very cautious.
Speaker #1: We're careful with default levels. We maintain our customer portfolio under control, and we can speak about this in detail subsequently. To ensure that everything is under control, is to be more conservative in the granting of credit.
Speaker #1: This means to say to have less products that have a high rate of default, so we sort of put aside the revenue margin for the short term to guarantee that in coming quarters, even in an adverse scenario, we can maintain a controlled credit portfolio and a healthy growth for the company.
[Company Representative] (Lojas Quero-Quero): We maintain our customer portfolio under control, and we can speak about this in detail subsequently. To ensure that everything is under control is to be more conservative in the granting of credit. This means to have less products that have a high rate of default. We sort of put aside the revenue margin for the short term to guarantee that in coming quarters, even in an adverse scenario, we can maintain a controlled credit portfolio and a healthy growth for the company. On the next slide, we have construction during the last quarters and during the last years, always keeping a focus on the level of expenses. It is important to keep this under control and to decide where to allocate our investments. In this Q2, we have a nominal reduction in operating expenses, very similar to what we saw in the Q1.
[Company Representative] (Lojas Quero-Quero): We maintain our customer portfolio under control, and we can speak about this in detail subsequently. To ensure that everything is under control is to be more conservative in the granting of credit. This means to have less products that have a high rate of default. We sort of put aside the revenue margin for the short term to guarantee that in coming quarters, even in an adverse scenario, we can maintain a controlled credit portfolio and a healthy growth for the company. On the next slide, we have construction during the last quarters and during the last years, always keeping a focus on the level of expenses. It is important to keep this under control and to decide where to allocate our investments. In this Q2, we have a nominal reduction in operating expenses, very similar to what we saw in the Q1.
Speaker #1: On the next slide, we have construction. During the last quarters and during the last years, always keeping a focus on the level of expenses.
Speaker #1: It is important to keep this under control and to decide where to allocate our investments and in this second quarter, we have a nominal reduction in operating expenses.
Speaker #1: A very similar to what we saw in the first quarter. So in this second quarter, specifically, we had a growth of sales of 1.8% below the inflationary pressure, and yes, we do have that ability to have operating leverage general and administrative expenses aligned with the second quarter of '25, positive as well as other SG&A expenses.
[Company Representative] (Lojas Quero-Quero): In the Q2 specifically, we had a growth of sales of 1.8% below the inflationary pressure. Yes, we do have that ability to have operating leverage, general and administrative expenses aligned with the Q2 of 2025 positive, as well as other SG&A expenses. This part of expenses is being kept under control, and we can go back to having a better operating leverage as soon as the sales increase. On the next slide, we reach an EBITDA of BRL 32.6 vis-à-vis BRL 29 for the previous quarter. As the same-store sales begin to show an improvement, as we saw in the previous slides, we can show you that we have an opportunity for operational leverage, very similar to the Q2 of 2025. The same holds true for adjusted EBITDA aligned with the previous quarter.
[Company Representative] (Lojas Quero-Quero): In the Q2 specifically, we had a growth of sales of 1.8% below the inflationary pressure. Yes, we do have that ability to have operating leverage, general and administrative expenses aligned with the Q2 of 2025 positive, as well as other SG&A expenses. This part of expenses is being kept under control, and we can go back to having a better operating leverage as soon as the sales increase. On the next slide, we reach an EBITDA of BRL 32.6 vis-à-vis BRL 29 for the previous quarter. As the same-store sales begin to show an improvement, as we saw in the previous slides, we can show you that we have an opportunity for operational leverage, very similar to the Q2 of 2025. The same holds true for adjusted EBITDA aligned with the previous quarter.
Speaker #1: So this part of expenses is being kept under control, and we can go back to have been a better operating leverage as soon as the sales increase.
Speaker #1: On the next slide, we reach an EBITDA of 32.6 vis-à-vis '29 for the previous quarter. Now, as the same store sales begin to show an improvement, as we saw in the previous slides, we can show you that we have an opportunity for operational leverage, very similar to the second quarter of '25.
Speaker #1: The same holds true for adjusted EBITDA, aligned with the previous quarter. On the next slide, we maintain the cost of capital a little higher, but more aligned with the second quarter of 2025, and the net result of 30 million nominally is virtually the same as that of the second quarter of '25.
[Company Representative] (Lojas Quero-Quero): On the next slide, we maintain the cost of capital a little higher but more aligned with the Q2 of 2025, and the net result of BRL 30 million nominally is virtually the same as that of the Q2 of 2025. This is what we had been remarking on, that as soon as we could have an increase in sales, same-store sales on a positive direction, we would be able to stabilize our results and have that possibility of improving throughout the year. On the next slide, we will go into greater details. We maintain the quality of our portfolio. Here you can see the growth of our credit portfolio historically, especially with the 90-day default rate that is maintained at 12.5% for the Q2. This, of course, is a historical achievement, especially if we compare this with 2024.
[Company Representative] (Lojas Quero-Quero): On the next slide, we maintain the cost of capital a little higher but more aligned with the Q2 of 2025, and the net result of BRL 30 million nominally is virtually the same as that of the Q2 of 2025. This is what we had been remarking on, that as soon as we could have an increase in sales, same-store sales on a positive direction, we would be able to stabilize our results and have that possibility of improving throughout the year. On the next slide, we will go into greater details. We maintain the quality of our portfolio. Here you can see the growth of our credit portfolio historically, especially with the 90-day default rate that is maintained at 12.5% for the Q2. This, of course, is a historical achievement, especially if we compare this with 2024.
Speaker #1: This is what we had been remarking on, that as soon as we could have an increase in sales, same store sales on a positive direction, we would be able to stabilize our results and have that possibility of improving throughout the year.
Speaker #1: On the next slide, we will go into greater details. We maintain the quality of our portfolio. And here you can see the growth of our credit portfolio historically, especially with the 90-day default rate that is maintained at 12.5% for the second quarter.
Speaker #1: This, of course, is a historical achievement, especially if we compare this with '24. We follow up on the default levels in the market as a whole, and you can see that we have been able to maintain the quality of our credit portfolio, and we have an ever-growing credit portfolio growing in a very healthy way.
Speaker #1: So we stand at 12.5% in the second quarter compared to 12% in the previous quarter. Now, these results are due to a broader use of our credit cards we had a growth of 13% in this quarter.
[Company Representative] (Lojas Quero-Quero): We follow up on the default levels in the market as a whole. You can see that we have been able to maintain the quality of our credit portfolio. We have an ever-growing credit portfolio growing in a very healthy way. We stand at 12.5% in Q2, compared to 12% in the previous quarter. Now, these results are due to a broader use of our credit cards. We had a growth of 13% in this quarter. We're gaining relevance in our credit cards for our customers. For the customer, this credit card is becoming ever more relevant in their day-to-day uses. We now go on to the next slide. Something that will have an impact, as Peter mentioned, the maintenance and control default and our credit portfolio, but also have an impact on our cash flow.
[Company Representative] (Lojas Quero-Quero): We follow up on the default levels in the market as a whole. You can see that we have been able to maintain the quality of our credit portfolio. We have an ever-growing credit portfolio growing in a very healthy way. We stand at 12.5% in Q2, compared to 12% in the previous quarter. Now, these results are due to a broader use of our credit cards. We had a growth of 13% in this quarter. We're gaining relevance in our credit cards for our customers. For the customer, this credit card is becoming ever more relevant in their day-to-day uses. We now go on to the next slide. Something that will have an impact, as Peter mentioned, the maintenance and control default and our credit portfolio, but also have an impact on our cash flow.
Speaker #1: And we're gaining relevance in our credit cards for our customers. And for the customer, this credit card is becoming ever more relevant in their day-to-day uses.
Speaker #1: We now go on to the next slide. And something that we'll have an impact as Peter mentioned, the maintenance and control default and our credit portfolio.
Speaker #1: But also, have an impact on our cash flow. We have a guidance of opening up several stores. This quarter, we opened up five in this quarter.
Speaker #1: So this shows a reduction of investment, once again, because of the high cost of capital. And you see an investment of 16.2 million and all of this will lead us to what we see in the next slide, which is a controlled net debt.
[Company Representative] (Lojas Quero-Quero): We have a guidance of opening up several stores this quarter. We opened up five in this quarter. This shows a reduction of investment, once again because of the high cost of capital. You see an investment of BRL 16.2 million. All of this will lead us to what we see on the next slide, which is a controlled net debt. In the last four quarters, we haven't had cash consumption, even with our financial expenses and the high cost of capital. Despite this, we're working strongly, focusing on investments, working capital to maintain the net debt under control. In Q2, we have the same net debt as in Q1 2026, which is the nominal debt with variations of one or two million. This compared to Q2 2025.
[Company Representative] (Lojas Quero-Quero): We have a guidance of opening up several stores this quarter. We opened up five in this quarter. This shows a reduction of investment, once again because of the high cost of capital. You see an investment of BRL 16.2 million. All of this will lead us to what we see on the next slide, which is a controlled net debt. In the last four quarters, we haven't had cash consumption, even with our financial expenses and the high cost of capital. Despite this, we're working strongly, focusing on investments, working capital to maintain the net debt under control. In Q2, we have the same net debt as in Q1 2026, which is the nominal debt with variations of one or two million. This compared to Q2 2025.
Speaker #1: In the last four quarters, we haven't had cash consumption. Even with our financial expenses and the high cost of capital, despite this, we're working strongly focusing on investments, working capital, to maintain the net debt under control.
Speaker #1: In the second quarter, we have the same net debt as in the first quarter of '26, which is the nominal debt with variations of one or two million.
Speaker #1: And this compared to the second quarter of '25. We had already remarked on this, and it becomes clear in the second quarter that we're working on cash flow to maintain once again the company debt under control.
Speaker #1: Well, I don't want to be repetitive, but this is what has been happening historically. We have a cash consumption in the first half of the year and cash production in the second half of the year.
[Company Representative] (Lojas Quero-Quero): We had already remarked on this. It becomes clear in Q2 that we're working on cash flow to maintain, once again, the company debt under control. Well, I don't want to be repetitive. This is what has been happening. Historically, we have a cash consumption in H1 and cash production in H2. This is what tends to normally happen. We don't expect anything different throughout this year. We have that opportunity to improve and generate cash beginning in H2, as we have done historically. Very well. With that, I would like to end my presentation. I will return the floor to Peter, who will begin the question and answer session. Well, thank you, Jean. We will now begin the question and answer session.
[Company Representative] (Lojas Quero-Quero): We had already remarked on this. It becomes clear in Q2 that we're working on cash flow to maintain, once again, the company debt under control. Well, I don't want to be repetitive. This is what has been happening. Historically, we have a cash consumption in H1 and cash production in H2. This is what tends to normally happen. We don't expect anything different throughout this year. We have that opportunity to improve and generate cash beginning in H2, as we have done historically. Very well. With that, I would like to end my presentation. I will return the floor to Peter, who will begin the question and answer session. Well, thank you, Jean. We will now begin the question and answer session.
Speaker #1: This is what tends to normally happen. And we don't expect anything different throughout this year. We have that opportunity to improve and generate cash beginning in the second half of this year as we have done historically.
Speaker #1: Very well. With that, I would like to end my presentation, and I will return the floor to Peter, who will begin the question and answer session.
Speaker #1: This year, we have that opportunity to improve and generate cash beginning in the second half of this year, as we have done historically very well. With that, I would like to end my presentation, and I will return the floor to Peter, who will begin the question and answer session. Well, thank you, Jean. We will now begin the question and answer session.
Speaker #1: Well, thank you, Jean. We will now begin the question and answer session. We remind you that the questions can be sent in through the Q&A icon in Zoom.
Speaker #1: The first question is from Denise Uspretto from Itaú BBA. It will be answered by Peter. Do you think the FIFA World Cup had a relevant impact on sales in the second quarter?
Speaker #1: You that the questions can be sent in through the Q&A icon in Zoom the first question is from Vinicius Preto from Itaú BBA it will be answered by Peter do you think the FIFA World Cup had a relevant impact on sales in the second quarter were they positive or negative did you estimate the magnitude of this effect and looking forward which will be the evolution of demand in the third quarter and your expectations for the second half of the year well good morning Preto it's always a pleasure to speak to you now regarding the FIFA World Cup yes we did have a slight increase in the sale of television sales but nothing that truly impacted our sales and at the end I would like to comment on our growth in share but we were not able to identify a true impact caused by the FIFA World Cup regarding your second point the evolution of consumption in the third and fourth quarters and our vision until the end of the year I don't foresee a growth of the market in the second half of the year what I do see is our gain in share and I think there is significant room to continue to gain share I don't believe the market will grow very much because of the interest rate that we have so we're going to focus on improving our performance products price and assortment to gain share this is our quest and we have seen competition that is also suffering significantly this gives us the opportunity to continue to grow this is my vision of the rest of the year well thank you Peter the second question is also from Vinicius Preto from Itaú BBA this will be answered by Jean what do you thinking.
Speaker #1: Were they positive or negative? Did you estimate the magnitude of this effect? And looking forward, which will be the evolution of demand in the third quarter?
[Company Representative] (Lojas Quero-Quero): We remind you that the questions can be sent in through the Q&A icon in Zoom. The first question is from Vinicius Preto from Itaú BBA. It will be answered by Peter. Do you think the FIFA World Cup had a relevant impact on sales in Q2? Were they positive or negative? Did you estimate the magnitude of this effect? Looking forward, which will be the evolution of demand in Q3 and your expectations for H2? Well, good morning, Preto. It's always a pleasure to speak to you. Now, regarding the FIFA World Cup, yes, we did have a slight increase in the sale of television sales. Nothing that truly impacted our sales. At the end, I would like to comment on our growth in share.
[Company Representative] (Lojas Quero-Quero): We remind you that the questions can be sent in through the Q&A icon in Zoom. The first question is from Vinicius Preto from Itaú BBA. It will be answered by Peter. Do you think the FIFA World Cup had a relevant impact on sales in Q2? Were they positive or negative? Did you estimate the magnitude of this effect? Looking forward, which will be the evolution of demand in Q3 and your expectations for H2? Well, good morning, Preto. It's always a pleasure to speak to you. Now, regarding the FIFA World Cup, yes, we did have a slight increase in the sale of television sales. Nothing that truly impacted our sales. At the end, I would like to comment on our growth in share.
Speaker #1: And your expectations for the second half of the year? Well, good morning, Uspretto. It's always a pleasure to speak to you. Now, regarding the FIFA World Cup, yes, we did have a slight increase in the sale of television sales, but nothing that truly impacted our sales.
Speaker #1: And. The end, I would like to comment on our growth in share. But we were not able to identify a true impact caused by the FIFA World Cup.
Speaker #1: Regarding your second point, the evolution of consumption in the third and fourth quarters and our vision until the end of the year, I don't foresee a growth of the market in the second half of the year.
[Company Representative] (Lojas Quero-Quero): We were not able to identify a true impact caused by the FIFA World Cup. Regarding your second point, the evolution of consumption in Q3 and Q4 and our vision until the end of the year, I don't foresee a growth of the market in H2. What I do see is our gain in share, and I think there is significant room to continue to gain share. I don't believe the market will grow very much because of the interest rate that we have. We're going to focus on improving our performance, products, price, and assortment to gain share. This is our quest, and we have seen competition that is also suffering significantly. This gives us the opportunity to continue to grow. This is my vision of the rest of the year. Well, thank you, Peter.
[Company Representative] (Lojas Quero-Quero): We were not able to identify a true impact caused by the FIFA World Cup. Regarding your second point, the evolution of consumption in Q3 and Q4 and our vision until the end of the year, I don't foresee a growth of the market in H2. What I do see is our gain in share, and I think there is significant room to continue to gain share. I don't believe the market will grow very much because of the interest rate that we have. We're going to focus on improving our performance, products, price, and assortment to gain share. This is our quest, and we have seen competition that is also suffering significantly. This gives us the opportunity to continue to grow. This is my vision of the rest of the year. Well, thank you, Peter.
Speaker #1: What I do see is our gain in share. And I think there is significant room to continue to gain share I don't believe the market will grow very much because of the interest rate that we have.
Speaker #1: So we're going to focus on improving our performance, products, price, and assortment to gain share. This is our quest. And we have seen competition that is also suffering significantly.
Speaker #1: This gives us the opportunity to continue to grow. This is my vision of the rest of the year. Well, thank you, Peter. The second question is also from Denise Uspretto from Itaú BBA.
Speaker #1: This will be answered by Jean. What do you thinking about in terms of cash generation for the second half of the year? I had already remarked on this.
[Company Representative] (Lojas Quero-Quero): The second question is also from Vinicius Preto from Itaú BBA. This will be answered by Jean. What are you thinking about in terms of cash generation for H2? I had already remarked on this. We do have a seasonality that benefits us in H2 in terms of sales. Now, in this quarter, we have a net debt very aligned with the net debt of the quarter in 2025, and this is a trend that we should see repeated in Q3. The trends are very similar to have a good performance. Well, formerly, we didn't consume cash in H1, and we would produce cash in Q3 and Q4. Of course, we have to maintain sales at the levels they are presently.
[Company Representative] (Lojas Quero-Quero): The second question is also from Vinicius Preto from Itaú BBA. This will be answered by Jean. What are you thinking about in terms of cash generation for H2? I had already remarked on this. We do have a seasonality that benefits us in H2 in terms of sales. Now, in this quarter, we have a net debt very aligned with the net debt of the quarter in 2025, and this is a trend that we should see repeated in Q3. The trends are very similar to have a good performance. Well, formerly, we didn't consume cash in H1, and we would produce cash in Q3 and Q4. Of course, we have to maintain sales at the levels they are presently.
Speaker #1: We do have a seasonality that benefits us in the second half of the year in terms of sales. Now, in this quarter, we have a net debt very aligned with a net debt of the quarter in 2025.
Speaker #1: And this is a trend that we should see repeated in the third quarter. The trends are very similar, to have a good performance. Well, formerly, we didn't consume cash in the first half of the year, and we would produce cash in the third and fourth quarters.
Speaker #1: Of course, we have to maintain sales at the levels they are presently. And this is what happened in the second half of 2025. But we do have a few factors, such as the drop in the SELIC rate, that might end up being positive.
Speaker #1: What we do expect is to maintain in the third quarter a debt that is equal or perhaps lower than what we saw in the third quarter in 2025.
[Company Representative] (Lojas Quero-Quero): This is what happened in H2 2025. We do have a few factors, such as the drop in the Selic rate, that might end up being positive. What we do expect is to maintain in Q3 a debt that is equal or perhaps lower than what we signed Q3 in 2025. We will continue with that focus on the control of our working capital. You'll see that our accounts and the balance are properly under control to continue to see an increase in sales and improvement of results in the coming quarter, resulting in the continuity of a controlled net debt and leverage. We hope to have a Q3 that is better than that in 2025. Thank you, Jean. The next question will also be answered by Jean. It refers to credit.
[Company Representative] (Lojas Quero-Quero): This is what happened in H2 2025. We do have a few factors, such as the drop in the Selic rate, that might end up being positive. What we do expect is to maintain in Q3 a debt that is equal or perhaps lower than what we signed Q3 in 2025. We will continue with that focus on the control of our working capital. You'll see that our accounts and the balance are properly under control to continue to see an increase in sales and improvement of results in the coming quarter, resulting in the continuity of a controlled net debt and leverage. We hope to have a Q3 that is better than that in 2025. Thank you, Jean. The next question will also be answered by Jean. It refers to credit.
Speaker #1: And we will continue with that focus on the control of our working capital you'll see that our accounts in the balance are properly under control.
Speaker #1: To continue to see an increase in sales and improvement of results in the coming quarter. Resulting in the continuity of a controlled net debt and leverage.
Speaker #1: And we hope to have a third quarter that is better than that in 2025. Thank you, Jean. The next question will also be answered by Jean.
Speaker #1: It refers to credit which has been the evolution of demand for credit and your deferred rates. What will happen with the new Dizzy Hola in the recovery of clients under default and the impact on your portfolio and the fact that people will take more credit?
Speaker #1: Well, the demand for the customer that exists we see that it has increased since the first quarter. That demand is there. Presently, however, we have to be careful not to service all of that demand if it is not sustainable through the coming quarters and year.
[Company Representative] (Lojas Quero-Quero): Which has been the evolution of demand for credit and your default rates. What will happen with the new Desenrola in the recovery of clients under default and the impact on your portfolio and the fact that people will take more credit? Well, the demand for the customer that exists, we see that it has increased since Q1. That demand is there. Presently, however, we have to be careful not to service all of that demand if it is not sustainable through the coming quarters and year. We have decided to become more conservative in products that pose a higher risk, and this is what is pressuring our margin in financial services. We're at a relatively stable level.
[Company Representative] (Lojas Quero-Quero): Which has been the evolution of demand for credit and your default rates. What will happen with the new Desenrola in the recovery of clients under default and the impact on your portfolio and the fact that people will take more credit? Well, the demand for the customer that exists, we see that it has increased since Q1. That demand is there. Presently, however, we have to be careful not to service all of that demand if it is not sustainable through the coming quarters and year. We have decided to become more conservative in products that pose a higher risk, and this is what is pressuring our margin in financial services. We're at a relatively stable level.
Speaker #1: We have decided to become more conservative in products that pose a higher risk. And this is what is pressuring our margin in financial services.
Speaker #1: We're at a relatively stable level. We would like to continue to grow in the coming quarters, simply because we have maintained the default rate under control.
Speaker #1: In a scenario of deteriorization of the macroeconomic factors in Brazil, we have indebtedness, high default levels that are consistently worse than they were in previous years.
[Company Representative] (Lojas Quero-Quero): We would like to continue to grow in the coming quarters simply because we have maintained the default rate under control in a scenario of deterioration of the macroeconomic factors in Brazil. We have indebtedness, high default levels that are consistently worse than they were in previous years. Therefore, this strategy that we have adopted has allowed us to maintain all of this under control. This Desenrola in the market should bring about some benefits. For us, it has an impact in collection and credit as well. It has had an impact on retailers and other companies, impacting the financial results. Now, in terms of our default rate and portfolio, it has not had an impact in the Q2, but this is a benefit for the market as a whole, as it allows people to leave that universe of default.
[Company Representative] (Lojas Quero-Quero): We would like to continue to grow in the coming quarters simply because we have maintained the default rate under control in a scenario of deterioration of the macroeconomic factors in Brazil. We have indebtedness, high default levels that are consistently worse than they were in previous years. Therefore, this strategy that we have adopted has allowed us to maintain all of this under control. This Desenrola in the market should bring about some benefits. For us, it has an impact in collection and credit as well. It has had an impact on retailers and other companies, impacting the financial results. Now, in terms of our default rate and portfolio, it has not had an impact in the Q2, but this is a benefit for the market as a whole, as it allows people to leave that universe of default.
Speaker #1: Therefore, this strategy that we have adopted has allowed us to maintain all of this under control. Dizzy Hola in the market should bring about some benefits and for us, it has an impact in collection and credit as well.
Speaker #1: It has had an impact on retailers and other companies, impacting the financial results. Now, in terms of our default rate and portfolio, it has not had an impact in the second quarter.
Speaker #1: But this is a benefit for the market as a whole, as it allows people to leave that universe of default and as soon as this becomes more stable with a dropping interest rate and less people in a situation of debt and default in the market, we can have a positive increase in demand, and we can, of course, service that demand.
[Company Representative] (Lojas Quero-Quero): As soon as this becomes more stable with a dropping interest rate and less people in a situation of debt and default in the market, we can have a positive increase in demand, and we can, of course, service that demand. What we're going to do this very calmly to avoid any default. Thank you, Jean. Next question will be answered by Peter. A growth of 6.7% in same-store sales shows an increase of pace compared to the Q1 2026 and other quarters in 2025. Has this improvement been consistent during the H1, or is it concentrated on some quarters? Is this due to some specific categories like air conditioning in the Q1 2025? Preto, well, the figures are very similar.
[Company Representative] (Lojas Quero-Quero): As soon as this becomes more stable with a dropping interest rate and less people in a situation of debt and default in the market, we can have a positive increase in demand, and we can, of course, service that demand. What we're going to do this very calmly to avoid any default. Thank you, Jean. Next question will be answered by Peter. A growth of 6.7% in same-store sales shows an increase of pace compared to the Q1 2026 and other quarters in 2025. Has this improvement been consistent during the H1, or is it concentrated on some quarters? Is this due to some specific categories like air conditioning in the Q1 2025? Preto, well, the figures are very similar.
Speaker #1: What we're going to do this very calmly to avoid any default. Thank you, Jean. Next question will be answered by Peter. A growth of 6.7% in same-store sales shows an increase of pace compared to the first quarter of 2026.
Speaker #1: Another quarter is in '25. Has this improvement been consistent during the first half, or is it concentrated on some quarters? And is this due to some specific categories, like air conditioning in the first quarter of '25?
Speaker #1: Britto, when we look at our same-store sales, well, the figures are very similar. We had a variation of 3 or 4% in home appliances, but we haven't had great variations we did not have a one-time growth for a specific category.
Speaker #1: We have had consistent growth, increasing through time. A comment that I would like to make here is that since mid last year, we have been fostering Luciano Scotta, who is our director of collection.
[Company Representative] (Lojas Quero-Quero): We had a variation of 3% or 4% in home appliances, but we haven't had great variations. We did not have a one-time growth for a specific category. We have had consistent growth increasing through time. A comment that I would like to make here is that since mid last year, we have been fostering Luciano Scotta, who is our Director of Collection. He has taken over the part of retail as well. Along with the team, he has been reviewing all of our processes, looking at the opportunities. Well, we don't have a crystal ball to resolve this. What we do have are several issues that have to be tackled at a minor level.
[Company Representative] (Lojas Quero-Quero): We had a variation of 3% or 4% in home appliances, but we haven't had great variations. We did not have a one-time growth for a specific category. We have had consistent growth increasing through time. A comment that I would like to make here is that since mid last year, we have been fostering Luciano Scotta, who is our Director of Collection. He has taken over the part of retail as well. Along with the team, he has been reviewing all of our processes, looking at the opportunities. Well, we don't have a crystal ball to resolve this. What we do have are several issues that have to be tackled at a minor level.
Speaker #1: He has taken over the part of retail as well. And along with a team, he has been reviewing all of our processes, looking at the opportunities.
Speaker #1: Well, we don't have a crystal ball to resolve this. What we do have are several issues that have to be tackled at a minor level.
Speaker #1: And so he has created a team with a new director of the purchasing area, Luis Felipe Barbosa. And they're working jointly with their teams night and day.
Speaker #1: And we have begun to see the results. They're in a hurry to see better results. But as you know, well, women cannot have a child in less than 9 months.
[Company Representative] (Lojas Quero-Quero): He has created a team with a new Director of the Purchasing Area, Luiz Felipe Barbosa, and they're working jointly with their teams night and day, and we have begun to see the results. They're in a hurry to see better results, but as you know, well, women cannot have a child in less than nine months. This takes time. You have to wait for the pregnancy to mature. We have the challenges of macroeconomy, but they seem to be pointing upwards, and I would like to congratulate them for the wonderful work they have done with their teams. Well, thank you. The last question will be answered by Jean. It's from Tomas Peredo from FD Capital. If you could give us more details on the pressure of margins in the retail market.
[Company Representative] (Lojas Quero-Quero): He has created a team with a new Director of the Purchasing Area, Luiz Felipe Barbosa, and they're working jointly with their teams night and day, and we have begun to see the results. They're in a hurry to see better results, but as you know, well, women cannot have a child in less than nine months. This takes time. You have to wait for the pregnancy to mature. We have the challenges of macroeconomy, but they seem to be pointing upwards, and I would like to congratulate them for the wonderful work they have done with their teams. Well, thank you. The last question will be answered by Jean. It's from Tomas Peredo from FD Capital. If you could give us more details on the pressure of margins in the retail market.
Speaker #1: This takes time. You have to wait for the pregnancy to mature. We have the challenges of macroeconomy, but they seem to be pointing upwards.
Speaker #1: And I would like to congratulate them for the wonderful work they have done with their teams. Well, thank you. Thank you. The last question will be answered by Jean.
Speaker #1: It's from Tomas Peredo from FD Capital. If you could give us more details on the pressure of margins in the retail market, is this due to market reasons, competitiveness, or has there been a one-time effect in the quarter?
Speaker #1: An increase in diesel in the third quarter, you have a weaker base of comparison, as this was the worst quarter for same-store sales in 2026.
[Company Representative] (Lojas Quero-Quero): Is this due to market reasons, competitiveness, or has there been a one-time effect in the quarter, an increase in diesel? In the Q3, you have a weaker base of comparison as this was the worst quarter for same-store sales in 2026. Should we expect a relevant increase of pace in same-store sales in the Q3, and what is your vision of gross margin? Good morning, Thomas. Are you well? First of all, regarding margin and then same-store sales. Regarding the margin, once again, there is seasonality. Historically, in the H1, we have better retail margins than in the Q2. When we look at the somewhat lower margins of the Q2 than in the Q1, this is due to seasonality. In some years, it becomes more or less relevant.
[Company Representative] (Lojas Quero-Quero): Is this due to market reasons, competitiveness, or has there been a one-time effect in the quarter, an increase in diesel? In the Q3, you have a weaker base of comparison as this was the worst quarter for same-store sales in 2026. Should we expect a relevant increase of pace in same-store sales in the Q3, and what is your vision of gross margin? Good morning, Thomas. Are you well? First of all, regarding margin and then same-store sales. Regarding the margin, once again, there is seasonality. Historically, in the H1, we have better retail margins than in the Q2. When we look at the somewhat lower margins of the Q2 than in the Q1, this is due to seasonality. In some years, it becomes more or less relevant.
Speaker #1: Should we expect a relevant increase of pace in same-store sales in the third quarter? And which is your vision of gross margin? Good morning, Thomas.
Speaker #1: Are you well? First of all, regarding margin and then same-store sales. Regarding the margin, once again, there is seasonality. Historically, in the first half, we have better retail margins than in the second quarter.
Speaker #1: When we look at the somewhat lower margins of the second quarter, than in the first quarter. This is due to seasonality. And in some years, it becomes more or less relevant.
Speaker #1: When we look at the third quarter of the previous year, we have a drop of 50 points in the retail. This is due to a combination we had a higher cost in logistics because of the increase of diesel, because of the war.
Speaker #1: This has an impact in the country. We had price increases, price pressure, and as Peter has already remarked, and what has been our focus in the last quarters, is to revisit the value proposition for the customer.
[Company Representative] (Lojas Quero-Quero): When we look at the Q3 of the previous year, we have a drop of 50 points in the retail. This is due to a combination. We had a higher cost in logistics because of the increase of diesel, because of the war. This has an impact in the country. We had price increases, price pressure. As Peter has already remarked, and what has been our focus in the last quarters is to revisit the value proposition for the customer. We're truly carrying out a revision, and we have come to a margin that will enable us to truly work well in the market. The market has not been increasing 8% as we grew in the Q2. It's a mix of things that we have been doing that enable us to gain share this relatively stable margin that should become sustainable.
[Company Representative] (Lojas Quero-Quero): When we look at the Q3 of the previous year, we have a drop of 50 points in the retail. This is due to a combination. We had a higher cost in logistics because of the increase of diesel, because of the war. This has an impact in the country. We had price increases, price pressure. As Peter has already remarked, and what has been our focus in the last quarters is to revisit the value proposition for the customer. We're truly carrying out a revision, and we have come to a margin that will enable us to truly work well in the market. The market has not been increasing 8% as we grew in the Q2. It's a mix of things that we have been doing that enable us to gain share this relatively stable margin that should become sustainable.
Speaker #1: So we're truly carrying out a revision and we have come to a margin that will enable us to truly work well in the market.
Speaker #1: The market has not been increasing 8% as we grew in the second quarter. So it's a mix of things that we have been doing that enable us to gain share.
Speaker #1: This relatively stable margin that should become sustainable. Well, we still have volatility. And we will continue to have volatility and this is what we see at the beginning of the second half of the year.
Speaker #1: Now, regarding expectations from same-store sales, the margins that we have presently should be replicated in the coming quarters. Of course, with certain fluctuations in terms of the level, but we truly should not have a significant impact, especially negative impacts, when it comes to margin.
[Company Representative] (Lojas Quero-Quero): Well, we still have volatility, and we will continue to have volatility. This is what we see at the beginning of the H2 of the year. Now, regarding expectations from same-store sales, the margins that we have presently should be replicated in the coming quarters, of course, with certain fluctuations in terms of the level. We truly should not have a significant impact, especially negative impacts when it comes to margin. Regarding sales, yes, in the Q3, we will have greater weakness if we maintain the present day level of sales in the Q2. We have the potential of delivering a stronger same-store sales in the Q3. There are other factors we have to be careful with, but up to present, we have maintained this vision that we will maintain our sales levels.
[Company Representative] (Lojas Quero-Quero): Well, we still have volatility, and we will continue to have volatility. This is what we see at the beginning of the H2 of the year. Now, regarding expectations from same-store sales, the margins that we have presently should be replicated in the coming quarters, of course, with certain fluctuations in terms of the level. We truly should not have a significant impact, especially negative impacts when it comes to margin. Regarding sales, yes, in the Q3, we will have greater weakness if we maintain the present day level of sales in the Q2. We have the potential of delivering a stronger same-store sales in the Q3. There are other factors we have to be careful with, but up to present, we have maintained this vision that we will maintain our sales levels.
Speaker #1: And regarding sales, yes, in the third quarter, we will have greater weakness if we maintain the present-day level of sales. In the second quarter, we have the potential of delivering a stronger same-store sales in the third quarter.
Speaker #1: There are other factors. We have to be careful with. But up to present, we have maintained this vision that we will maintain our sales levels we have had, whether impacts, especially in Rio Grande do Sul, of course, this holds back the sale of construction material.
Speaker #1: Once the climate is more stable, we should go back to the sales level we saw in the second quarter. And if we maintain the second quarter, we will have a better same-store sales average.
[Company Representative] (Lojas Quero-Quero): We have had weather impacts, especially in Rio Grande do Sul, of course. This holds back the sale of construction material. Once the climate is more stable, we should go back to the sales level we saw in the Q2. If we maintain the Q2, we will have a better same-store sales average for the Q3. Thank you. Thank you, Jean. Now, with that question, we would like to conclude the Q&A session. We remind you that our IR team is at your entire disposal to clarify doubts through the email ri@quero-quero.com.br. I return the floor to Peter for the company's closing remarks. Well, we would like to thank all of you for your attendance. It was a pleasure to carry out our earnings call conference.
[Company Representative] (Lojas Quero-Quero): We have had weather impacts, especially in Rio Grande do Sul, of course. This holds back the sale of construction material. Once the climate is more stable, we should go back to the sales level we saw in the Q2. If we maintain the Q2, we will have a better same-store sales average for the Q3. Thank you. Thank you, Jean. Now, with that question, we would like to conclude the Q&A session. We remind you that our IR team is at your entire disposal to clarify doubts through the email ri@quero-quero.com.br. I return the floor to Peter for the company's closing remarks. Well, we would like to thank all of you for your attendance. It was a pleasure to carry out our earnings call conference.
Speaker #1: For the third quarter, thank you. Thank you, Jean. Now, with that question, we would like to conclude the Q&A session. We remind you that our IR team is at your entire disposal to clarify doubts through the email ri.querocapital.com.br.
Speaker #1: I return the floor to Peter for the company's closing remarks. Well, we would like to thank all of you for your attendance. It was a pleasure to carry out our earnings call conference.
Speaker #1: Our expectation is of a gradual operational enhancement, maintaining sales and a controlled cash flow and debt in this scenario that is definitely below its potential.
Speaker #1: And this is what we have been doing. We hope to continue delivering operational results that improve during the coming quarters. Thank you all. And I will give the floor to Peter now to close.
[Company Representative] (Lojas Quero-Quero): Our expectation is of a gradual operational enhancement, maintaining sales and a controlled cash flow and debt in this scenario that is definitely below its potential. This is what we have been doing. We hope to continue delivering operational results that improve during the coming quarters. Thank you all, and I will give the floor to Peter. To close, I have some messages here. The first is that the Q1 results reinforce our confidence in the strategy we're following. The recovery of same-store sales that evolved in the Q1 became consolidated in the Q2. It confirms our value proposition and our service to customer. They're generating good results. This happened without leaving aside our financial control. The cash generation is a priority, and this year we have not consumed any cash, which is very positive. Another factor is the quality of our credit portfolio.
[Company Representative] (Lojas Quero-Quero): Our expectation is of a gradual operational enhancement, maintaining sales and a controlled cash flow and debt in this scenario that is definitely below its potential. This is what we have been doing. We hope to continue delivering operational results that improve during the coming quarters. Thank you all, and I will give the floor to Peter. To close, I have some messages here. The first is that the Q1 results reinforce our confidence in the strategy we're following. The recovery of same-store sales that evolved in the Q1 became consolidated in the Q2. It confirms our value proposition and our service to customer. They're generating good results. This happened without leaving aside our financial control. The cash generation is a priority, and this year we have not consumed any cash, which is very positive. Another factor is the quality of our credit portfolio.
Speaker #1: I have some messages here. The first is that the quarter results reinforce our confidence in the strategy we're following. The recovery of same-store sales that evolved in the first quarter became consolidated in the second quarter.
Speaker #1: It confirms our value proposition and our service to customer. They're generating good results. Now, this happened without leaving aside our financial control. Now, the cash generation is a priority.
Speaker #1: And this year, we have not consumed any cash, which is very positive. Another factor is the quality of our credit portfolio. We maintained highly aligned even in a scenario of increases.
Speaker #1: And despite the macroeconomic environment, we maintain our expenses under control, as well as the quality of our credit portfolio. We look upon the rest of 2026 with a great deal of confidence.
[Company Representative] (Lojas Quero-Quero): We maintain it highly aligned even in a scenario of increases. Despite the macroeconomic environment, we maintain our expenses under control as well as the quality of our credit portfolio. We look upon the rest of 2026 with a great deal of confidence. We will maintain our operational discipline, and we believe that the results presented in the H1 of the year will ensure the evolution of our company in a gradual and consistent way, always focusing on cash generation, the quality of credit, and the creation of value in the long term. A 10% increase in revenue, 50 basis points in the retail margin. The fact that we're holding back default problems and maintaining a constructive portfolio allows us to control the cost below inflation.
[Company Representative] (Lojas Quero-Quero): We maintain it highly aligned even in a scenario of increases. Despite the macroeconomic environment, we maintain our expenses under control as well as the quality of our credit portfolio. We look upon the rest of 2026 with a great deal of confidence. We will maintain our operational discipline, and we believe that the results presented in the H1 of the year will ensure the evolution of our company in a gradual and consistent way, always focusing on cash generation, the quality of credit, and the creation of value in the long term. A 10% increase in revenue, 50 basis points in the retail margin. The fact that we're holding back default problems and maintaining a constructive portfolio allows us to control the cost below inflation.
Speaker #1: We will maintain our operational discipline. And we believe that the results presented in the first half of the year will ensure the evolution of our company in a gradual and consistent way.
Speaker #1: Always focusing on cash generation, the quality of credit, and the creation of value in the long term. A 10% increase in revenue 50 base points in the retail margin.
Speaker #1: The fact that we're holding back default problems and maintaining a constructive portfolio allows us to control the cost below inflation. And the fact that we don't consume cash shows a very positive execution of a team that truly makes me proud to manage Kerokero.
[Company Representative] (Lojas Quero-Quero): The fact that we don't consume cash shows a very positive execution of a team that truly makes me proud to manage Quero-Quero. Thank you once again for your attendance. We hope to see you again in our next call.
[Company Representative] (Lojas Quero-Quero): The fact that we don't consume cash shows a very positive execution of a team that truly makes me proud to manage Quero-Quero. Thank you once again for your attendance. We hope to see you again in our next call.
